Windows to Russia

This story by Leonid Savin, political scientist, Strategic Culture Foundation expert, was published in International Affairs magazine.

The EU oil embargo recently slapped on Iran and the threats voiced by the US and other Western countries to come up with further sanctions against the country led watchers to conclude that an armed conflict between Iran and the West finally became imminent.

The first potential scenario in the context is that the current standoff would eventually escalate into a war. The US forces in the Gulf area currently number 40,000, plus 90,000 are deployed in Afghanistan, just east of Iran, and several thousands of support troops are deployed in various Asian countries. That adds up to a considerable military potential which may still fall short of what it takes to keep a lid on everything if armed hostilities break out. For example, Colin H. Kahl argues in a recent paper in Foreign Affairs that, even though “there is no doubt that Washington will win in the narrow operational sense” (1), the US would have to take a vast array of pertinent problems into account.

At the moment, maintaining the status quo is not in the US interests, holds Stratfor, a US-based global intelligence agency: “If al Assad survives and if the situation in Iraq proceeds as it has been proceeding, then Iran is creating a reality that will define the region. The United States does not have a broad and effective coalition, and certainly not one that would rally in the event of war. It has only Israel …” (2) If the conflict with Iran takes the shape of a protracted bombing campaign and comes as a prologue to the occupation of the country, the US will need to strengthen its positions in adjacent regions, meaning that Washington will be trying to draw the Caucasian republics (Georgia, Azerbaijan) and those of Central Asia into the orbit of its policy and thus tightening the “Anaconda loop” around Russia.

An alternative scenario also deserves attention. The EU sanctions would surely hurt many of the European economies – notably, Greece, Italy, and Spain – by a ricochet. In fact, Spanish diplomacy chief José Manuel García-Margallo Y Marfil bluntly described the sanctions decision as a sacrifice (3). As for Iran, the oil blockade can cause its annual budget to contract by $15-20b, which generally should not be critical but, as the country’s parliamentary elections and the 2013 presidential poll are drawing closer and the West actively props up its domestic opposition, outbreaks of unrest in Iran would quite possibly ensue. Tehran has already made it clear it would make a serious effort to find buyers for its oil export elsewhere.

China and India, Iran’s respective number one and number three clients, brushed off the idea of the US-led sanctions momentarily. Japan pledged support for Washington over the matter but did not post any specific plans to reduce the volumes of oil it imports from Iran. Japan, by the way, was badly hit in 1973 when Wall Street provoked an oil crisis and the US guarantees turned hollow. Consequently, Tokyo can be expected to approach Washington’s sanction suggestions with utmost caution and to ask the US for unequivocal guarantees that the White House will be unable to provide. Right now the US is courting South Korea with the aim of having it cut off the import of oil from Iran.

The opposition mounted to the plans underlying the military scenario by China, Russia, and India seems to hold the promise of an alliance of countries seeking to tame the US hegemony and raging unilateralism. Stratfor analysts have a point saying that time is not on the US side, considering that the BRICs countries have some opportunities to influence the situation in the potential conflict zone by launching joint anti-terrorism and anti-piracy maneuvers in the Arabian Sea and the Persian Gulf etc.

Inducing the regime change in Iran, which is Washington’s end goal, still takes a pretext. The US has long been eying various factions in Iran in the hope to capitalize on the country’s existing domestic rivalries parallel to the employment of tested color revolution techniques such as the support for the Green Movement or the establishment of a virtual embassy for Iran. Richard Sanders, a vocal critic of the US foreign policy, opined that, at least since the invasion of Mexico in the late XIX century, the US permanently relied on the mechanism of war pretext incidents to compile justifications for its military interventions (4). US arch-conservative Patrick J. Buchanan cited in his opinion piece titled “Did FDR Provoke Pearl Harbor?” the fairly common view that the US financial circles knowingly provoked the Pearl Harbor attack to drag the US into a war with the remote goal of ensuring the dollar empire’s global primacy (5). The lesson to be learned from the history of the Vietnam War, namely the Gulf of Tonkin incident in which USS Maddox entered Vietnam’s territorial waters and opened fire on the boats of its navy, is that the initial conflict was similarly ignited by the US intelligence community, the result being that the US Congress authorized LBJ to militarily engage Vietnam (by the way, no retribution followed in June 1967 when the Israelis attacked USS Liberty, killing 34 and wounding 172). The morally charged concepts of humanitarian interventions and war on terror had just as well been invoked to legitimize downright aggressions against Yugoslavia, Iraq, and Afghanistan.

Speaking of the current developments around the Persian Gulf, Washington’s choice of pretexts for an aggression comprises at least three options, namely 1) Iran’s nuclear dossier; 2) an engineered escalation in the Strait of Hormuz; 3) allegations that Iran supports international terrorism.

The US objective behind the pressure on Iran over its nuclear program – to make everybody in the world accept Washington’s rules of the game – has never been deeply hidden. The abundant alarmist talk is intended to deflect attention from the simple truth that building a nuclear arsenal with the help of civilian nuclear technologies is absolutely impossible, but Matthew H. Kroenig from the Council on Foreign Relations recently went so far as to warn that Iran would some day pass its nuclear technologies to Venezuela (6). The motivation must be to somehow bundle all critics of the US foreign policy.

The Strait of Hormuz which is the maritime chokepoint of the Persian Gulf is regarded as the epicenter of the coming new war. It serves as the avenue for oil supplies from Iran, Iraq, Kuwait, Qatar, the Saudi Arabia, and the United Arab Emirates and is therefore being closely monitored by all likely parties to the conflict. According to the US Department of Energy, the 2011 oil transit via the Strait of Hormuz totaled 17 billion barrels, or roughly 20% of the world’s total (7). Oil prices are projected to increase by 50% if anything disquieting happens in the Strait of Hormuz (8).

Passing through the Strait of Hormuz takes navigation across the territorial waters of Iran and Oman. Iran grants as a courtesy the right to sail across its waters based on the UN Treaty on Maritime Goods Transportation.

It must be understood in connection with Washington’s recurrent statements concerning the Strait of Hormuz that in this regard the US and Iran have the same legal status as countries which penned but did not ratify the treaty, and thus the US has no moral right to references to the international law. Iran’s administration stressed recently after consultations with the national legislation that Tehran would possibly subject to a revision the regulations under which foreign vessels are admitted to the Iranian territorial waters (9).

Navies are also supposed to observe certain international laws, in particular, those defining the minimal distance to be maintained to vessels of other countries. It constantly pops up in the US media that Iranian boats come riskily close to US vessels but, as watchers note, provocateurs like the CIA-sponsored separatists from Iran’s Baluchistan could in some cases be pulling off the tricks in disguise.

Chances are that a part of the oil embargo plan is to make the West encounter oil supply problems and start constructing pipelines across Saudi Arabia, Bahrain, Oman, Yemen, Qatar, and Iraq as alternative routes reaching the shores of the Arabian, Red, and Mediterranean Seas. A few of these projects, the Hashan–Fujairah pipeline, for instance, are as of today in the process of being implemented. If that is the idea, the explanation behind Washington’s tendency to convince its allies to create a “safer” pipeline infrastructure is straightforward. Geopolitics being an inescapable reality, it does have to be taken into account, though, that the region’s countries remain locked in a variety of conflicts and, due to geographic reasons, Tehran would be a key player even if the pipelines are launched.

Since the new US military strategy implies focusing on two regions – the Greater Middle East and South East Asia – the issue of the Strait of Hormuz appears coupled to that of the Strait of Malacca which offers the shortest route for the oil supply from the Indian Ocean to China, Japan, South Korea, and the rest of South East Asia. The arrangement implicitly factors into the Asian countries’ decision-making related to Iran.

The precedent of “the war on terror” – a campaign during which the US occupied under dubious pretexts Iraq and Afghanistan at the costs of thousands of lives – must also be kept in mind. Ages ago, the White House sanctioned subversive activities against various parts of the Iranian administration, including the Guardians of the Islamic Revolution. Former CIA operative Phillip Giraldi writes that the US and Israeli agents have been active in Iran for quite some time and are responsible for the epidemic of the Stuxnet virus and the series of assassinations of Iranian nuclear physicists. The groups within Iran which aligned themselves with the country’s foes are the People’s Mujahedin of Iran, the Baluchistan-based separatist Jundallah whose leader Abdolmajid Rigi was arrested in February, 2010 by the Iranian security forces and admitted to cooperating with the CIA, and the Kurdish Free Life of Kurdistan (10).

In essence, a war against Iran – up to date a secret war – is underway. The problem the parties involved are trying to resolve is to find a way of prevailing without entering the “hot” phase of the conflict.

(Views expressed in this article reflect the author’s opinion and do not necessarily reflect those of Windows to Russia. Windows to Russiadoes not vouch for facts and quotes mentioned in the story)

1.     Colin H. Kahl. Not Time to Attack Iran. January 17, 2012.
http://www.foreignaffairs.com/articles/137031/colin-h-kahl/not-time-to-attack-iran?cid=nlc-public-the_world_this_week-link6-20120120
2.    Iran, the U.S. and the Strait of Hormuz Crisis. January 17, 2012. http://www.stratfor.com/weekly/iran-us-and-strait-hormuz-crisis?utm_source=freelist f&utm_medium=email&utm_campaign=20120117&utm_term=gweekly&utm_content=readmore&elq=b90cfbef7b1a402ea2f1fc384080fa15
3.    La UE acuerda vetar las importaciones de petroleo de Iran. 23.01.2012 http://www.lavanguardia.com/internacional/20120123/54245752767/ue-vetar-importaciones-petroleo-iran.html
4.    Richard Sanders. How to Start a War: The American Use of War Pretext Incidents. Global Research, January 9, 2012.
5.   
6.    Recent Events in Iran and the Progress of Its Nuclear Program. January 17, 2012. http://www.cfr.org/iran/recent-events-iran-progress-its-nuclear-program/p27090?cid=nlc-public-the_world_this_week-link5-20120120
7.     http://www.eia.gov/cabs/world_oil_transit_chokepoints/full.html
8.    Michael T. Klare. Danger Waters. January 10, 2012. http://aep.typepad.com/american_empire_project/2012/01/danger-waters.html#more
9.    Mahdi Darius Nazemroaya. The Geo-Politics of the Strait of Hormuz: Could the U.S. Navy be defeated by Iran in the Persian Gulf? Global Research, January 8, 2012. www.globalresearch.ca/index.php?context=va&aid=28516
10.    Philip Giraldi. Washington’s Secret Wars. 08 December 2011.

Windows to Russia!

Hello,

I was drinking my morning cup of coffee and watching a video that Svet put on the Russian Video Blog!

A fact that I had no idea about, was that the Soviet Union made their own Champagne! I always thought that only the French had Champagne *(Champagne is a sparkling wine produced by inducing the in-bottle secondary fermentation of the wine to effect carbonation. It is produced exclusively within the Champagne region of France, from which it takes its name.)

‘Soviet Champagne’ was born 72 years ago, when Stalin signed a decree ordering production of a sparkling wine called ‘Sovetskoye Shampanskoye’. The first wineries appeared in the southern city of Rostov and later in Gorky (now Nizhny Novgorod), in central Russia.

I have feeling that the French do not accept that the Soviets had Champagne any more than it is accepted that America makes a Champagne. But Russia has carried on the tradition in full force and no New Years in Russia would not be complete with out the local Champagne. (Sparkling Wine)

A little history on the Soviet Champagne: Chemist Anton Frolov-Bagreev is the man considered to be the founding father of ‘Soviet Champagne’ he devoted his entire life to perfecting his technology. It seems that he even perfected a way to allowed for fermentation of the champagne in reservoirs, rather than in bottles as before. This allowed for mass production, making champagne a drink for the masses. Frolov attained his dream of popularizing the drink after the Second World War. For several years in the Soviet Union, champagne was even sold on tap (spigot) in the food stores next to the fruit juices!

Russia has continued and will continue with Champagne production the Soviet way and every New Years multiple millions of bottles are sold of the world famous Soviet Champagne.

So next year try a Soviet Champagne at the New Year…

Kyle & Svet

comments always welcome.

Hello, While this is an old post of mine it still has much meaning in the world. It is a shame that we as a human race can not just have peace, happiness and calm…

I was drinking my morning cup of coffee and reading about a subject that brought back memories of an era, I hope stays gone. Thirty years ago the USSR informed the world it had successfully tested one of the deadliest weapons ever invented – a neutron bomb. The day has gone down in arms race history.

A neutron bomb is an enhanced radiation weapon (ERW); the killing mechanism is an intense burst of high-energy neutrons.

Its peculiarity as a thermonuclear weapon is that the energy emission is much slower than that of the usual thermonuclear blast.

So, the amount of energy used to create the blast wave and heat flash is much less, but the stream of neurons which destroys people and animals is many times stronger. At the same time, buildings and equipment are not affected at all.

I remember that In 1978 President Jimmy Carter halted neutron device production as concern grew over its effects on the arms race. I remember that it was another weapon that seemed to be used to scare us.

The Neutron Bomb was heavily propagandized in the USA and Russia. Both countries already had the means to destroy the world several times over with their nuclear arsenals. But the sound of a bomb that could destroy all life and leave the buildings intact made for many conversations in school and gatherings.

The image of walking the streets of a huge city devoid of life has been the basis for many sci fi books. This weapon just added to the imaginations of generations of youngsters from the USA and USSR!

Kyle & Svet

comments always welcome.

Russian Foreign Minister Sergei Lavrov said:

“The people who are obsessed with removing regimes in the region (Middle East), they should be really thinking about the broader picture. And I’m afraid that if this vigor to change regimes persists, we are going to witness a very bad situation much, much, much broader than just Syria, Libya, Egypt or any other single country.”

Oh how true he speaks! Please Western governments, stop and think about the games you play. For you – are why the innocents are dying in the name of democracy and regime change…

Kyle Keeton
Windows to Russia!

PS: Russia is firing the warning shots and now China has joined also. Warning shots are the civilized way of doing things. It seems strange to me that the only countries with the coolest heads and most common sense are the countries that America has labeled as evil and deadly. Think people think…

I am drinking a good cup of hot chicory and have the extra heater on. I got a little bit cold.: It was about -27 below Celsius as I walked the dog and my eyes started to tear up from the cold. That is when I realized that my left eye had frozen shut. Not badly, but still the eye lashes had frozen together. Then I realized that a tear had frozen on my cheek. Now that was so cool… (No pun intended!)

By the time we had gotten back from an hour long walk. The temperature had warmed up to about -25 below zero Celsius. (Yes a proverbial heat wave.) So I checked on Yandex what is -25 C in Fahrenheit? It is around -13 F… (Which means -27 C is around -17 F)

We probably stayed out to long and by the time we got back Boza was starting to feel the cold and was trying to keep any paw paw he could off the ground. He decided that two paws on the ground was the best answer… 🙂 (Better yet in my arms would be the best!) I could not feel my face and that seemed like a good time to go in…

Walking the dog in Moscow is always an experience and since I walk the dog a lot, I get lots of experiences…

That is why I love Russia and now I am going to go make a cream of chicken noodle soup for Sveta and I, for tonight on this bitterly cold evening…

Kyle Keeton
Windows to Russia!

PS: I see old ancient Babushkas walking around in this weather like it is nothing. I realize that they have spent their whole life in these conditions. They are battle hardened people that know no other way of life. Also when the sun shines, even at -25 below zero, the mommas have their kids out in the sun playing in the parks. The kids can not get up if they fall down due to all the clothes and coats, but that is what mom is for, to pick them back up as they flounder in the snow. Then the moms pull their kids around in sleds all day and do the shopping…

That is why I love Russia…

Under the title “Why the United States does not want to elect Putin as the Russian president”  Komsomolskaya Pravda daily quoted some excerpts from a survey of a famous US political scientist and economist William Engdahl. Engdahl’s survey was published in Germany. The newspaper noted that Engdahl is convinced the US is seeking to discredit the Russian national leader, because the latter remains the major obstacle on the way for the West’s domination in the world.

“Washington clearly wants ‘finito’ with Russia’s Putin as in basta! Hillary Clinton and friends have apparently decided Russia’s prospective next president, Vladimir Putin, is a major obstacle to their plans. Few however understand why. Russia today, in tandem with China and to a significant degree Iran, form the spine, however shaky, of the only effective global axis of resistance to the world dominated by one sole superpower,” Engdahl noted.

“No mistake, Putin is not a world champion practitioner of what most consider democracy. His announcement some months back that he and current President Medvedev had agreed to switch jobs after Russia’s March 4 Presidential vote struck many Russians as power politics and backroom deal-making.

“That being said, what Washington is doing to interfere with that regime change is more than brazen and interventionist. The same Obama Administration, which just signed into law measures effectively ripping to shreds the Bill of Rights of the US Constitution for American citizens is posing as the world’s supreme judge of others’ adherence to what they define as democracy,” the political scientist remarked.

Engdahl offers to consider Putin’s recent statement that the US interferes in the elections, giving them hasty assessments. It is easy to find an official annual report (delivered in August 2011) of the Washington-based non-government organization with an innocuous name of the National Endowment for Democracy, he writes. According to the report the organization has already penetrated very deeply everywhere in Russia. The National Endowment for Democracy funds the International Press Centre in Moscow, where about 80 non-government organizations can give press conferences on each topic. The endowment also funds numerous youth organizations and seminars for future chief executives in order to help young people to engage in politics. Over 2,783,000 dollars were officially spent in 2010 for tens of similar programs in all Russian regions, the US political scientist claims.

The National Endowment for Democracy also finances the vital parts of independent sociological surveys in Russia and election observer missions make an important part of its activities in order to have an opportunity to state about election rigging. This is the National Endowment for Democracy which sponsors partially the Golos association.

“Helping youth engage in political activism is precisely what the same NED did in Egypt over the past several years in the lead up to the toppling of Mubarak. The same NED was instrumental by informed accounts in the US-backed “Colour Revolutions” in 2003-2004 in Ukraine and Georgia that brought US-backed pro-NATO surrogates to power,” Engdahl assumed.

“The salient question is why Putin at this point? We do not need to look far for the answer. Washington and especially Barack Obama’s Administration don’t give a hoot about whether Russia is democratic or not. Their concern is the obstacle to Washington’s plans for Full Spectrum Dominance of the planet that Putin’s Presidency will represent,” he speculates.

“We can also expect a more aggressive use of Russia’s energy card with pipeline diplomacy to deepen economic ties between European NATO members such as Germany, France and Italy, ultimately weakening the EU support for the aggressive NATO measures against Russia. We can expect a deepening of Russia’s turn towards Eurasia, especially with China, Iran and perhaps India to firm up the shaky spine of resistance to Washington’s New World Order plans,” Engdahl underlined.

Windows to Russia!

Russia has been the most vocal voice against a Western backed death resolution against Syria. I have said all along that China has the same feelings. Well it is official now as China has come out from the background and expressed their sentiments on the Syrian subject…

UNITED NATIONS, February 1 (Itar-Tass) — China will support Russia’s draft resolution on Syria, Permanent Representative of China to the United Nations Li Baodong said at a session of the U.N. Security Council on Syria on Tuesday. According to Li Baodong, China intends to take an active and constructive part in consultations and make efforts together with other parties towards the settlement of the situation in Syria through a political dialogue. The Xinhua news agency on Wednesday quoted him as saying China is categorically against the use of force to change the regime in Syria as this violates “the purposes and principles of the U.N. Charter and the basic norms governing the international relations”. The Chinese ambassador also backed Russia’s offer to the Syrian authorities and all opposition groups to send their representatives to Moscow for consultations without any preconditions.

So the single most important fact at the UN council meeting going on is the fact that Russia and China stand united and they both have veto power…

Of course after Hillery Killery Clinton tells everyone that: “I know that some members (UN) here are concerned that we are headed toward another Libya. That is a false analogy. Syria is a unique situation that requires its own approach, tailored to the specific circumstances on the ground.”

Okay – well we all know that what Hillary says is the word from god and we must believe! Right?

Since when would anyone believe a word that is said by a USA government official/politician, any time and anyplace in this world? Our reputation is worse than a bag of excrement left on someone’s front porch and lit on fire, as the door bell is rang, as a gag. This reputation is entirely Americas doing, by her actions when she plays, in other peoples back yards…

America reminds me of the comic strip “Peanuts” – we all have cringed, when Lucy always tells Charley Brown that she has changed and will not pull the football away as Charley Brown tries to kick it. But…

Well that comic episode sums up the US administrations word, reliability and respectability…

Kyle Keeton
Windows to Russia!

PS: Expect to see a huge increase in media rhetoric against China now that they have expressed consolidation with Russia…

The word on the street is that very soon this side of the world’s countries will be back to doing business with their own currencies, oil, gold, silver and plus other commodities. Barter is going to become a revived word on this side of the world…

It looks like India has really woke up and it is inevitable before many other countries follow suit and start to drop the dollar for trade in most goods: India said this Monday it is deciding whether to use its own currency, the rupee, to pay for oil imports from Iran in the face of a US-led sanctions campaign aimed at forcing Tehran to abandon its nuclear program. India has said it will continue to import oil from Iran, joining China in refusing to bow to intensifying US pressure not to do business with Iran. India has been using gold in the last few transactions…

This is from my article a few days ago: Death of the Petrodollar – That American backed financial destruction of Iran theme, only gets weaker when one learns that Iran is dumping the dollar $ in its trade with Russia for rials and rubles, Then it shudders some more as we realize that it is a similar move to ones already made in its trade with China and Japan. As for India, its also refuses to stop buying Iranian oil and thumbed it’s nose at the USA, by trading gold for oil. India incidentally is already using the yuan with China in trade. As Russia and China have also been trading in rubles and yuan for more than a full year and Japan and China are now promoting direct trading in yen and yuan. Then to ice the cake, Iran and China, have agreed that all new trade and joint investments will be settled in yuan and rial. The East is inter trading and bartering as the dollar is becoming worthless. Other Eastern countries will join the parade as the dollar backed by the US sinks into the sunset…

India, Russia, Iran and China are now basically using their own money to do business with each other. If they are not, the work is being done to allow them to interchange finances. The dollar is being inflated on purpose and the East is catching the brunt of that inflation. The dollar is becoming worthless. So I would say by the end of the year of 2012 there will be a dozen + countries on this bandwagon…

It should worry you, that while the Western world is waging war on all of the world and it is spouting hate all over the world 24 hours a day. The real world is silently switching gears and processes to enable it to survive a world when the Western Empire collapses…

I have said many times, “The West will go down fighting!” That looks to be true as I write this article and that makes me sad…

Kyle Keeton
Windows to Russia!

The endgame of the global financial crisis of 2008-09 has begun. The West seeks to inflate away its massive debt – by exporting inflation to the emerging East.

The World Bank recently warned developing countries to prepare for the risk of the world going into a slump like the global downturn in 2008-09 owing to an escalation in the eurozone debt crisis.

Ironically, the worst threat stems not from what could go wrong, but from the way the eurozone, along with the United States, seeks to resolve the debt crisis. Today, all major advanced economies – not just Japan, but also the United States and Western Europe – are sinking deeper into a liquidity trap.

Full recovery remains far away, as evidenced by the US Federal Reserve’s recent announcement that it intends to hold short-term interest rates near zero “at least through late 2014.”

In Washington, the trap was set by the exhaustion of traditional instruments of monetary policy, which prompted the Federal Reserve to initiate new rounds of quantitative easing (QE). With investors seeking higher returns, more QE has driven “hot money” (short-term portfolio flows) into high-yield emerging-market economies, inflating potentially dangerous asset bubbles in Asia, Latin America and elsewhere.

At the same time, emerging and developing countries had to move in the opposite direction of QE, that is, toward quantitative tightening. In China, interest rates were increased to 6.6 percent. In India, the central bank has raised rates a dozen times to 8.5 percent since March 2010 to bring down inflation. Brazil’s central bank recently reduced rates to 10.5 percent to shield the economy from the eurozone crisis.

In his famous 2002 speech on the potential of deflation in America, Fed Chairman Ben Bernanke suggested that former US president F.D. Roosevelt’s 40 percent devaluation of the dollar in 1933-1934 shows that the exchange rate policy can be an “effective weapon against deflation”. But because of global interdependency, domestic rate decisions in vital economies can today facilitate or constrain growth worldwide.

Already in fall 2010, Chen Deming, China’s minister of commerce, complained that “the United States’ issuance of dollars is out of control and international commodity prices are continuing to rise”. China was attacked by “imported inflation”.

In retrospect, Washington’s hot money, however, was only the first act in the ongoing crisis. The second has already begun – in Europe. Since the global crisis and the onset of the eurozone turmoil in May 2010, European leaders have tried a wide array of measures – fiscal pain, monetary easing, hollow growth, bailouts, restructurings – to contain their debt crisis, but with few results.

The remaining option: printing money.

During the past few years, financial institutions from debt-stricken eurozone countries such as Greece, Portugal and Ireland have borrowed extensively from the European Central Bank (ECB). Since May 2010, the ECB has purchased sovereign bonds from crisis-stricken eurozone member states worth 213 billion ($280 billion). This translates into increasing risks at the ECB, because of the collaterals that banks must post when they borrow money from the ECB.

In turn, the ECB has provided euro banks with massive amounts of liquidity. In December, it injected European banks with 500 billion with long loan periods of three years. The assumption is that the debt and the collaterals are sustainable.

Instead of passing the ECB money in loans to companies for employment and to stimulate the economy, banks, in turn, have re-parked the money with the ECB. As deposits at the ECB pile up, unemployment in the eurozone continues to spread.

In early January, Italy and Spain had few problems raising new funds in sovereign bond auctions. This was widely perceived as “easing of tension” in the financial markets. In turn, the ECB defended the abundant liquidity as an “effective policy measure”. In reality, the ECB was allowing some banks to use its liquidity in the auctions to buy the bonds.

What’s going on here? A cynic might call it debt monetization.

As the ECB is injecting the banks with cheap money, it is artificially creating demand for sovereign bonds. This allows the ECB to cut bank on its own bond purchases, which has been criticized, while pumping up artificial demand, which is not understood.

Naturally, euro banks love the ECB policy. Now they can borrow easy money from the ECB for three years at a low interest rate. If they use that money to buy bonds in crisis economies, they will get a much higher interest rate. Besides, they can re-park these bonds at the ECB as security, which allows them to borrow even more low-interest money. In the short term, this financial magic benefits the banks, the struggling economies and even the ECB. In the long-term, it is unsustainable.

When the money-printing machine eventually falls apart, it could severely harm the banks, bankrupt the cash-strapped countries and undermine the very legitimacy of the ECB.

To avoid Japan’s two lost decades, the West has now opted to inflate away its massive debt burden. The domestic effect is immense deflation and continued unemployment. The Fed and the ECB both are implementing vast real exchange rate depreciation by printing money. It is the West’s effort to force the emerging world to accommodate drastic inflation and thus nominal rate appreciation.

From the standpoint of the emerging East, it is comparable to successive waves of QE, which amount to debasing the value of the dollar and the euro alike. The net effect is a massive financial tsunami that has already begun to form but may eventually sweep away the emerging and developing economies alike.

The author is research director of international business at India, China and America Institute, an independent think tank in the US, and visiting fellow at Shanghai Institutes for International Studies (China).

Windows to Russia!

Russia is taking a hardline against the West on Syria and Iran. This all came about after the West lied through its nose over Libya. Russia knows that Syria is being slandered in the MSM and they know that Iran has been slandered for years the same way. Medvedev lost a lot of respect in Russia when he fell for the trap that America wove on Libya. That more than anything has kept him from running for president again. He just plain messed up and kissed America’s ass and it bit him back. Medvedev is known for being paid off with an iPhone…

That is the Coffee Thinking’s this morning…

But now that Russia balks at the Western needs and desires to destroy countries for their own personal gain. The Western press is on a lie and deceit binge, that is being presented to the Western people. Lets have an example: This weekend we had a few cars put white balloons on their cars and call themselves a protest. Maybe at the best 300 cars did this. The Western press says 5000 cars were out protesting the demise of Putin… 🙂

The LA Times says: At least 5,000 cars participated in the novel demonstration on wheels, billed as a dress rehearsal for a massive anti-Putin march slated for next weekend.

So was there even 300 cars out protesting? Most likely not, but the police after trying to give an estimate of the cars say 300 cars at the high side. From what I see the police are being nice and give a benefit of the doubt. The protest was mainly a bunch of bored rich kids who have no life. Lots of Audi’s and BMW’s weaving through traffic at a high speed. Except when being videoed for their own purpose. Russians drive like the devil himself is chasing them and protesters are no exception. But one thing for sure! There was not 5000 cars involved if there had been there would have been a hundred wrecks and the Garden ring road would have been blocked for hours. Russians can not drive and 5000 idiots in one place would have destroyed the roads. Someone would have died. You have to live here to understand…

With reporting like that being the norm (Yes, always the norm!), how could you even trust a single thing that the Western press says? The Western press is like a cat coughing up a hairball. No one wants to see it except the cat…

Now I got off the subject a little bit, but if you lived here you would understand how credulous and credit-less  the Western press is when it writes articles about Russia. The Western press does not check out facts anymore. They have no journalist rules anymore. They just print what they are told to print by the higher ups…

But this article is about the onslaught that is coming from the Western press against Putin/Kremlin and for the opposition in Russia…

Actually Americans should be confused, very confused. I see a huge push by America to promote the communist party in Russia. Now being an American I know that this is against the grain in America. We are taught that communism is the most evil thing on earth and must be eradicated. But the Western press is actually rooting for the communist party. The west says things like, Putin will win but if this and this and this happen then the communist party’s leader Gennady Zyuganov has a chance in a run off! So lets chippy Do DA and Ra Ra Ra for the communist…

So drink a cup of coffee and think about America and her ability to kiss the enemies ass when she wants to cause issues in the world…

I did some thinking’s and came up with: We armed Saddam and then killed Saddam, we hugged Libya and then killed Libya, we helped Osama then killed Osama, we arm al-Qaeda we hate, want to eradicate al-Qaeda (In fact I am beginning to think that al-Qaeda is a branch of the USA government to promote hate in the world.) The list is a mile long and if you can’t see it! Then I really can not help you much. It just means that you long ago stuck your head in the sand and never pulled it out again…

What is our future?

Well that is a good question and it seems that the desire to destroy Syria and Iran are high on the list for the next wars. Sooner or later, Israel will slip and or America will instigate a false flag issue. So while Iran or Syria can not win a war with the USA. They will take out a few aircraft carriers by submarines and such. I feel that it is a terrible thing that we have put so many men in harms way. Go ahead and look up how many men are on a carrier. It is like a duck shooting gallery. Iran has subs…

Conclusion: We are lying our way into another war or wars. We have lied our way into many wars. We are a war nation. We are wrong and the world really does wish that we would go away at times. We have made ourselves believe that we are the “cats meow”, but the world sees us at times, as the hairball that the cat spits out…

Kyle Keeton
Windows to Russia!

PS: We will wait and see if Russia has what it takes to keep the hardline against the West for Syria and Iran. China is right there with Russia though…